XML 38 R18.htm IDEA: XBRL DOCUMENT

Leases

12 Months Ended

Dec. 31, 2021

NOTE 10 Leases

Substantially all of the leases in which the Company is the lessee are comprised of real estate property for branches, and office equipment rentals with terms extending through 2027. Portions of certain properties are subleased for terms extending through 2023. Substantially all of the Company’s leases are classified as operating leases. The Company has one finance lease for a portion of the Company’s headquarters building with a lease term through 2022.

The Company elected not to include short-term leases (i.e., leases with initial terms of twelve months or less), or equipment leases (deemed immaterial) on the consolidated financial statements. The following table presents the classification of the Company’s ROU assets and lease liabilities on the consolidated financial statements.


		December 31,		December 31,
(dollars in thousands)		2021		2020
Lease Right-of-Use Assets	Classification
Operating lease right-of-use assets	Operating lease right-of-use assets	$	3,727	$	6,918
Finance lease right-of-use assets	Land, premises and equipment, net		87		202
Total lease right-of-use assets		$	3,814	$	7,120
Lease Liabilities
Operating lease liabilities	Operating lease liabilities	$	4,275	$	7,861
Finance lease liabilities	Long-term debt		203		430
Total lease liabilities		$	4,478	$	8,291

The calculated amount of the ROU assets and lease liabilities in the table above are impacted by the length of the lease term and the discount rates used to calculate the present value of the minimum lease payments. The Company’s lease agreements often include one or more options to renew at the Company’s discretion. If at lease inception, the Company considers the exercising of a renewal option to be reasonably certain, the Company will include the extended term in the calculation of the ROU asset and lease liability. Regarding the discount rate, Topic 842 requires the use of the rate implicit in the lease whenever the rate is readily determinable. As this rate is rarely determinable, the Company

utilizes its incremental borrowing rate at lease inception, on a collateralized basis, over a similar term. For the Company’s only finance lease, the Company utilized its incremental borrowing rate at lease inception.


	December 31,		December 31,
	2021		2020
Weighted-average remaining lease term, years
Operating leases	3.4		5.8
Finance leases	0.8		1.8
Weighted-average discount rate
Operating leases	2.5	%	2.9	%
Finance leases	7.8	%	7.8	%

As the Company elected, for all classes of underlying assets, not to separate lease and non-lease components and instead to account for them as a single lease component, the variable lease cost primarily represents variable payments such as common area maintenance utilities. Variable lease cost also includes payments for usage or maintenance of those capitalized equipment operating leases.

The following table presents lease costs and other lease information for the years ending December 31, 2021, 2020 and 2019:


	Year ended
	December 31,
(dollars in thousands)	2021		2020		2019
Lease costs
Operating lease cost	$	1,827	$	2,457	$	2,378
Variable lease cost		823		1,170		819
Short-term lease cost		181		395		535
Finance lease cost
Interest on lease liabilities		25		42		58
Amortization of right-of-use assets		116		116		116
Sublease income		(228)		(228)		(270)
Net lease cost	$	2,744	$	3,952	$	3,636
Other information
Cash paid for amounts included in the measurement of lease liabilities operating cash flows from operating leases	$	1,763	$	2,432	$	2,376
Right-of-use assets obtained in exchange for new operating lease liabilities	$	267	$	1,555	$	—

Future minimum payments for finance and operating leases with initial or remaining terms of one year or more as of December 31, 2021 are as follows:


	Finance		Operating
(dollars in thousands)	Leases		Leases
Twelve months ended
2022	$	209	$	1,663
2023		—		1,343
2024		—		579
2025		—		447
2026		—		252
Thereafter		—		423
Total future minimum lease payments	$	209	$	4,707
Amounts representing interest		(6)		(432)
Total operating lease liabilities	$	203	$	4,275